I wonder what DAW you are using, that doesn't compensate for processing delay when playing penciled notes. Another thing you should note, is that when USB is connected, all the physical ports change functionality, as part of the total integration with your computer, namely, the physical MIDI in becomes MIDI in for your computer, since the Virus becomes just another soundcard. So you should either disconnect the USB; use the "Virus TI synth" MIDI port when the USB is connected; or use the VC but set the patches to output to the Analog out.
Here's
another discussion regarding this matter, but it takes delay compensation into consideration, so it might not be relevant to you.